For a turnkey property, in an "A" neighborhood, a reasonable cash-on-cash return might range between 5-8%, since these areas tend to be more stable but with lower returns.

Typically, you want to refinance to take cash out or lower your rate by 1.00%. 

Rate will be lower than hard money, lower fees, and you won't have to deal with draws/draw fees. 

If I were you, I would be firm with needing rent more timely, I would still contact the male because she can't kick him off the lease, and I would have a conversation with her along the lines of "this is clearly not what either of us signed up for, is clearly not working, and what can we do to get you to a lower cost living situation as soon as possible?" 

The rates do tend to be a few basis points higher but are often lower than conventional. 

Regarding risk my perspective is that it is much lower than typical common equity deals in that there is a 25% cushion re valuation drop before the pref equity holders would be impacted.

But if I’m buying 20 -40 lower priced properties annually I may decide to skip title insurance on the buy side and substitute a thorough title search.  

A cash flow-positive property is ideal.Financing Options: Explore loan options like FHA, which may allow you to buy with a lower down payment if you live in one unit while renting out the other.3.

Very few accurately price the cost of doing business in lower tier neighborhoods into their pro-forma and that gets investors into trouble. 

Generally places with high cash flow on paper are cheap homes in not so great areas where you have higher turnover, damages and real cash flow is lower.